Russia to invest 1.7 million euro to the South Stream gas pipeline with Serbia

Dmitry Medvedev and Ivica Dacic

Photo: RIA Novosti

Dmitry Medvedev and Ivica Dacic

Russia will invest 1.7 billion euro to the construction of the South Stream gas pipeline. Serbia confirmed the beginning of its construction in December, Serbian Prime Minister Ivica Dacic said during a joint press conference with Russian Prime Minister Dmitry Medvedev.

Russia will finance 1.7 billion euro worth of the construction, and Serbia will provide its portion later during mutual offsets for gas pumping tariffs.

Dacic said the Russian side had proposed financing construction of the entire Serbian segment of the pipeline.

"We believe this proposal to be appropriate. It will enable the project to move forward unhindered," he said.

Gazprom CEO Alexei Miller confirmed to journalists the financing mechanism for the Serbian segment of the pipeline and the volume of financing, 1.7 billion euro.

Moscow will continue to support Belgrade on the Kosovo question but it thinks that Serbians themselves should be active in the first turn, Russian Prime Minister Dmitry Medvedev told a press conference after a meeting with his Serbian colleague Ivica Dacic.

"It means that we will certainly always give support to our Serbian friends," Medvedev said.

First of all, Moscow expects Belgrade to present a clear position, the Russian prime minister said. "The process needs to be fostered by Serbia, not us," Medvedev said. Sometimes there is the impression that more is expected from Russia than from Serbia on the Kosovo question, he noted. "This is wrong," the Russian prime minister stressed.

The Serbian prime minister said that Belgrade was prepared to continue negotiations on the Kosovo issue. "We want to carry on the dialogue [with Pristina] and find a lasting solution but we would certainly never agree with the unilateral decoration of independent Kosovo," Dacic said.

Hence Serbia is asking Russia to support the return of Kosovo negotiations from the EU to the UN, where the problem was pondered initially.

Russia has agreed to grant Serbia a $500 million loan, Serbian Prime Minister Ivica Dacic said on Wednesday, with a first tranche of $300 million to be handed over immediately, a correspondent of the Voice of Russia reported.

Russia and Serbia have signed a governmental agreement on the allocation of a state financial credit to Belgrade. The Finance Ministers of the two countries Anton Siluanov and Mladjan Dinkic put their signatures under this document. Thesigning ceremony was held on the results of the talks between the prime ministers of Russia and Serbia.

Russian Finance Minister Anton Siluanov said Serbia would get a first $300 million tranche immediately.

“We will now sign [the documents] and they will immediately get...the first tranche of $300 million,” said Siluanov.

“An agreement will be signed on the provision of a half a billion dollar loan by Russia for the Serbian budget,” Dacic said at a meeting with Russian Prime Minister Dmitry Medvedev.

In September 2012 Serbia asked Russia for a government loan to finance the budget deficit. Serbia originally requested a $1 billion loan but in March 2013 Serbian Finance and Economy Minister Mladjan Dinkic said the countries were negotiating a $500 million loan.

Dacic said the Serbian people were grateful to Russia for the support it was providing.

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